Tech M&A market getting hotter

Happy Days, indeed.

Another of our precious portfolio companies was acquired last week; the 4th such deal in the past 6 months. Belair (Ottawa), Ember (Boston) and Clairmail (San Rafael, CA) were the first three picked off this year from our Wellington Financial Fund III. We’ve either been lucky, chosen our companies well, or (and?) there’s an urgent wave of tech M&A underway in North America.

This time it was Pivot Inc., a VC-backed story based in Jersey City, NJ. Pivot helps investment professionals turn information into liquidity by connecting investors and brokers, financial content producers and service providers. The Company provides its community members with content management capabilities, access to automated trade entry and exchanges and collaborative workspaces for instant communications and message management. Clients are largely drawn from the thousands of sell-side and buy-side professionals.

CME Group (CME:Q) was the acquiror (think Chicago Mercantile Exchange), and the plan is to launch the CME’s own instant messaging platform for the Energy Trading Community over the CME’s electronic trading platform.

Pivot’s investors included DFJ Gotham Ventures, Eze Castle Integration, Hudson Ventures and Softbank Capital. For our own institutional investors, this is another happy reminder of the benefits of taking warrants in a deal.

Although our fund isn’t large enough to serve as a representative sample of the continent’s entire private company ecosystem, I can’t help but note that only one Fund II or Fund III portfolio company was acquired during all of 2011 — and that was a modest broken-down tuckunder. Across the Canadian tech nation, think of Q9, Miranda and 20-20 Technologies as recent examples of 2012 bids. The momentum is there.

Congrats to everyone on the Pivot team; twas a pleasure to watch your success unfold over the past two years.

MRM